Maersk Drilling buys jack-up rig from rival company

May 27, 2016

Danish driller Maersk Drilling has acquired a newbuild harsh environment jack-up rig from its distressed rival Hercules Offshore. What is more, the rig comes with a five-year drilling contract in the North Sea.

The company has signed a definitive agreement to acquire the newbuild harsh environment jack-up rig, formerly named Hercules Highlander, from a subsidiary of Hercules Offshore. The company will take immediate delivery of the rig from Jurong Shipyard in Singapore.

According to the agreement, Maersk Drilling assumes the right to take delivery of the rig and Maersk Drilling settles the final payment of approximately $190m with Jurong. To remind, when Hercules ordered the rig back in 2014, it said the total delivery cost was estimated at approximately $270 million.

The rig will enter the Maersk Drilling fleet under the name Maersk Highlander, and after the acquisition, Maersk Drilling’s rig fleet counts 23 rigs with an additional harsh environment jack-up rig under construction.

After delivery, the rig will be mobilized to the North Sea to start a five-year drilling contract with Maersk Oil and its partners, BP and JX Nippon, on the Culzean gas field offshore the UK. The value of the five-year drilling contract is around $420m, including a mobilization fee of $9m.

“This agreement represents an opportunity for Maersk Drilling to acquire a newbuild harsh environment jack-up backed by a firm long-term contract. We look forward to working with Maersk Oil and its partners on the Culzean gas field,” says CEO in Maersk Drilling and member of the Executive Board in the Maersk Group, Claus V. Hemmingsen.

The rig design is Friede & Goldman JU2000E, categorized as a 400ft rig, with 30,000ft drilling depth and HPHT (High Pressure High Temperature) capabilities. The rig has accommodation capacity for up to 150 personnel.

Offshore Energy Today Staff